Lanxess AG : “This Year will be Big for India and Germany”

It is a very promising start into 2012 for LANXESS in India: two new plants have been inaugurated at the Jhagadia site. We had the opportunity to talk to Board Member Rainier van Roessel at the events on the subcontinent.

Jhagadia, India - LANXESS: India is a very fascinating country. What have been your most impressive experiences so far?

Rainier van Roessel: Since we have grown considerably in India within the last couple of years, I have had the pleasure to be there as a guest at several events and experience the country. I especially noticed the great optimism and the impressive enthusiasm when it comes to realizing new projects. As opposed to China - to which India is often compared to - the infrastructure needs a lot of work and there is very much room for improvement. Improvement that we can support with our products! But despite that India has experienced a gigantic economic boom, which is very impressive.

Also, I noticed how cordial the people in India are. About a year ago I visited the organization "Save the Children India" near Mumbai that we support as a part of our Corporate Responsibility program. The project also runs a school for children from a weak social background as well as children with disabilities. I was really impressed how much can be done with simple things to enable a higher life quality and education for the students. After all, the good education and very good English skills are the keys to the steady success of India.

LANXESS: You are here for the inauguration of two plants in one day - LANXESS is heavily investing in India! What is the background story?

Rainier van Roessel: The plant opening in Jhagadia fit into a bigger picture. In September 2011 - German Chancellor Angela Merkel and Indian Prime Minister Manmohan Singh opened the "Indian-German year 2011-2012" laying the focus one of the largest growth markets in the world. This will be a big year for India and Germany and also for LANXESS, India is a very promising market and so this year starts off perfectly with a strong commitment to India and the further strengthening of our site Jhagadia as a specialty chemicals hub for the region. We are currently employing some 285 people at the Jhagadia site but are determined to stock up that number.

Ever since LANXESS decided to make our major growth investments in the BRIC countries, India has gained significant importance. Our acquisition of Gwalior in 2009 was highly successful and adds to our sales numbers in India. Just to give an example: In 2010 our sales on the subcontinent were EUR 179 million, now we have surpassed that with EUR 184 million in the first nine months of 2011 - with three more months to go.

The four megatrends mobility, water, urbanization and agriculture - which we are gearing our operations towards - are especially visible here and we have a vast market to sell our products to. The main industry that we sell our high-tech rubbers and plastics to is the automotive market…and that is supposed to grow by 15 percent by 2015. Also the construction industry is growing - experts predict a growth to exceed 9 percent by 2015.

This is why we are investing in India - to strengthen our production sites for the even greater boom in India that is to come.

LANXESS: Much of the LANXESS production in India has been concentrated at the Jhagadia site. What is the strategy behind that?

Rainier van Roessel: Overall, LANXESS has invested around EUR 70 million in the Jhagadia site to date and is the growing specialty chemicals hub for LANXESS in India. The new facility was constructed on an area totaling 180,000 square meters. Jhagadia is conveniently located with excellent links to international ports. This ensures that Jhagadia serves as a perfect platform to supply our customers not only in the rapidly-growing local market but also in the whole Asia-Pacific region!

Last but not least, the construction of Jhagadia was also a great opportunity to incorporate state-of -the-art technology when it comes to environment safety: Already during the planning phase, strict standards going beyond the stipulations of the authorities and regional environmental specifications applied. The wastewater is pre-cleaned in a separate wastewater treatment plant by LANXESS before it is released into the chemical park's wastewater system. Huge amounts have been invested in environmentally friendly energy generation. LANXESS uses a cogeneration plant for the company's own power station. This is run on natural gas. In total, around 20 percent of total construction costs were used for sustainability projects.

LANXESS: Despite its economic boom poverty is still a national concern in India. What can LANXESS do to help?

Rainier van Roessel: Since LANXESS realizes that it is important to give something back to society we have several Corporate Responsibility programs in the countries we produce in. In India we mainly focus on helping children, because we feel that education is a key factor in making people succeed in life and make a good living. One big project we fund is "Teach for India", that recruits and mobilizes top Indian college graduates and young professionals, namely fellows, who commit to teaching full-time for two years in underfunded schools.

Another project is "Save the Children India", a non-profit organization established in 1988 that is working towards the empowerment of the disadvantaged children and women, with its health, nutrition, education and vocational training programs.

Besides numerous social projects throughout India we also have several environmental projects geared towards clean water and green manufacturing. An overview can be found at .

LANXESS: Thank you for talking to us, Mr. van Roessel!